Talking OpenText, BoxWorks, AMD, Adobe Max, Microsoft and Google

By Patrick Moorhead - October 16, 2023

On this episode of The Six Five Webcast, hosts Patrick Moorhead and Daniel Newman discuss the tech news stories that made headlines this week. The handpicked topics for this week are:

OpenText World 2023
BoxWorks 2023
AMD Acquires Nod.AI
Adobe Max 2023
Microsoft Owes $29B to IRS?
Google to Defend Gen AI Users From Copyright Claims

For a deeper dive into each topic, please click on the links above. Be sure to subscribe to The Six Five Webcast so you never miss an episode.

Watch the episode here:

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Disclaimer: The Six Five Webcast is for information and entertainment purposes only. Over the course of this webcast, we may talk about companies that are publicly traded and we may even reference that fact and their equity share price, but please do not take anything that we say as a recommendation about what you should do with your investment dollars. We are not investment advisors and we ask that you do not treat us as such.

Transcript:

Patrick Moorhead: Hi, this is Pat Moorhead and we are live for the Six Five Friday podcast. Daniel, how you doing my friend?

Daniel Newman: It is Friday, Pat, and it’s been a whirlwind of a week. I’m glad to be in my chair. I’m glad to be home because this is going to be more the exception than the rule. I was looking out the next several weeks and I’m like, when are we actually going to do these podcasts? We got F1, we’ve got Qualcomm, we’ve got maybe a VMware EU or some other event. We just got travel after travel and it’s like, man, what is going on?

Patrick Moorhead: It’s just busy. I mean, I think this whole generative AI thing just kicked everybody off. And not only do we have the same industry events, and then each tech vendor has their own annual event or two or three times a year event, but now there are special generative AI events. We’ve seen it from Microsoft, we’ve seen it from Google, AWS. In fact, Microsoft had two special events where they dove into that. Yeah, but listen, even though I’m literally, for anyways, audience on my second PC, had some serious technical difficulties, so I’m sorry we’re late for those who tune in at 9:00 AM on Friday Central Time. But for those of you who just listen to it on audio or just kind of delayed video, you wouldn’t know it. But I do want to bring that out. I’m chilling here in a town in between Austin and Houston, so if you’re wondering where I’m broadcasting from. So anyways, thanks for everybody coming.

Daniel Newman: Good to see you, man. It’s good you’re back. Get the sand out of the eyes. I landed at like 2:00 AM last night.

Patrick Moorhead: Oh, boy.

Daniel Newman: Yeah. Well, you know what the worst part about it was for me, Pat, was I was really tired, but I was so sure morning was going to come that I couldn’t stay asleep. I kept waking up thinking like, okay, and it was like 3:30 and then 4:40 and then 5:30, and I finally just gave up at six. I’m like, all right, getting up. This is-

Patrick Moorhead: I’ve been there and it’s not fun. I’m pretty sure I was doom scrolling when you arrived, but anyways, Dan, I’m glad you’re here. Yeah, you got in a lot later than I did, but I think-

Daniel Newman: All good, man. Sometimes it’s you, sometimes it’s me.

Patrick Moorhead: Yeah, I think I was on your schedule. I think I got three hours sleep the night before and I’m still catching up on it. But anyways, it’s great to be here. We got a good show for you today. We’re talking OpenText, BoxWorks, AMD, Adobe MAX, a little bit of Microsoft, and we also have a Google topic as well.

Daniel Newman: Yeah, I should’ve updated that one. I didn’t update it everywhere.

Patrick Moorhead: Okay, Dan, this is-

Daniel Newman: Hold on, hold on, hold on, the Google topic. There we go. There we go. All right, back to the other one.

Patrick Moorhead: Anyway, so let’s dive in. Dan, you and I were in Las Vegas, our second home at OpenText World 2023, the Six Five was there interviewing and chatting with the most senior management at the company.

Daniel Newman: Six Five was there, Pat, and yeah, let’s talk a little bit about OpenText world. Let’s talk a little bit about OpenText. How about that?

Patrick Moorhead: Yeah. No, that’s a great place to start.

Daniel Newman: OpenText is one of those really big companies that most people have never heard of, and when I say most, I don’t mean enterprises. Enterprises know OpenText, but when I’m thinking like consumers, because they don’t make PCs or devices or phones, they are a pure enterprise information management play that is now almost six billion dollars or is six billion dollars in revenue and has done so through a pretty substantial series of inorganic and acquisitions as well as really focusing on helping companies deal with the information management age. This event, we did have the Six Five there. We talked to their CEO, their CMO and their chief product officer, all of which you’ll be able to watch videos and we’ll have to drop those in the links here as soon as they’re up and ready. But let’s be straight what this event’s all about. And I didn’t hear what you said there, Pat.

Patrick Moorhead: Oh, I muted it. I was screaming to the rest of the family I’m recording a podcast.

Daniel Newman: Professional stuff, people, we got to stay with this here, but that’s what we do and we’re on the road. Anyway, so we got to talk to the leadership. Make no mistake, this company’s been enabling information and data and management in the enterprise across the full stack of business intelligence, machine learning, automation for a long time. But this event was all about AI and you simply cannot spell Aviator without AI. And that this company was zeroed in on telling a story, architecture, baby, telling a story about how companies can, I don’t know, download a million documents for 350,000 and then lay generative capabilities all on top of it. And Pat, the continuum of what it’s doing in Aviator really does go from your most sort of citizen developer friendly Aviator for business products all the way to your incredibly complex Aviator for technologist products that enable companies to build very custom with a poly LLM approach all the way to sort of pre-canned uploaded documents with CX and DX and enterprise search capabilities.

But the company really does have a story there, and this is probably what was most interesting to me. I came in, we’ve covered OpenText for about a year, so I still am in the phase where I’m learning more about the company and the business, and I was trying to say, what is the thing that this company really stands out for? And to me it’s all about data across the continuum being able to be managed and then being able to layer meaningful generative applications that take into consideration the important tenets of responsible AI, privacy, security, and accuracy. So Pat, I think the company did a really good job. I think Aviator and its new brand spokesperson Ice caught the attention. I really enjoyed the fact that the company came out with a meaningful monetizing strategy for this. Helping companies, actually pleading companies to partner in terms of getting them to the point where their data, and that’s data from SharePoint, data from SAP, data from Oracle, data from Salesforce, can all be looked at under the guise of being used for generative apps.

You can get a lot more in the conversations that we have, Pat, but my take here is that OpenText is a very interesting company. It’s really thinking about AI in a very holistic fashion. It’s not about good and bad AI, it’s just AI. We heard Mark Barrenechea, CEO say that more than one time, you don’t drive a safe car, you just drive a car. And I largely agree with that, but I don’t know if you’ve ever seen Pat on the track. But anyways, good show, good event, good primer here. Check out those videos. Pat, what was your take there?

Patrick Moorhead: Yeah, so that was a great intro and additive, and I’ve been researching the company for about a year, and I’ll admit it’s been a slow role. You get a company that does so many different things in the enterprise, and they’re this combination of a lot of acquisitions, Micro Focus is a great example and four or five different companies along the way, but it’s a company on the move. And I think the safe and accurate way to characterize the company is it’s all about information management. They have their apps, but it is all about ingesting every type of data type, enterprise data type on the planet and managing that data. And the CEO, Mark Barrenechea-

Daniel Newman: Barrenechea, yeah.

Patrick Moorhead: Just threw out big and impressive numbers. They manage 96 trillion rows of Vertica, a trillion pages of content managed. And it’s one thing to manage it and it’s another thing to secure it, but to activate it is really the key here. Otherwise, it’s just technology for a technology sake. And with Aviator, I think we really saw this in action when they showed a demo of Aviator Search. And on the left handrail there were about 30 data types from billing to CRM, Salesforce, Documentum, teams, Twitter, internal Slack, internal OneDrive, and then the ability to lay across generative AI. And Dan, I’m the pain in the butt in a lot of the Q and A in these rooms, and you may or may not recall in a major CRM meeting, it’s like, how are you going to connect all this data together? And Salesforce had a visionary video on how to do that.

And here, we actually saw it in real life in Aviator search. So that really brings in the power of it. And they did a demo of Log4Shell, that was a big security issue that happened a way back. And they showed how Log4Shell came in every single private and company query that came out. We saw how a contract was put together using these tools as well from disparate data sources. So super interesting stuff. But again, folks, check out the coverage when we publish it next week on all of these interviews. There’s three. We had the CEO, chief product officer, chief marketing officer, who also runs Partner as we found.

Daniel Newman: Good call. The multi job machine, Sandy Ono, she’s great too.

Patrick Moorhead: Yeah, she really is.

Daniel Newman: Did you screenshot that, dude? When you were going through all the, I mean, was that a… Or is that all from memory? Because I pride myself on having a great memory and you got the sources.

Patrick Moorhead: Oh, it’s totally, I’m checking out my photos. So Dan, I’m kind of like Einstein, why remember things you can just write down and in this day and age things you can take pictures of?

Daniel Newman: What do we do with all that additional space in our brain that we no longer use to remember people’s phone numbers?

Patrick Moorhead: I don’t know. I think I burned those cells out drinking Tito’s. I don’t know. We’ll see. Hey, let’s move to a very different… It’s funny we just talked about document management and secure document management and lighting it up. Well, here’s Box, that’s exactly what Box does. Box was securing multiple types of data and finding really novel ways to share it, way, way when they first started, it started off as a storage in the cloud company. And let’s not confuse this with Box the company, but they were up there with OneDrive and they really have a corner on regulated industries. And I know a lot of our tech clients, they deliver us content right out of BoxWorks and it auto-magically has your own NDA, more insights and strategy against it, but they’re finding different ways to activate that data and leverage it inside of AI. So, they had their premier event, BoxWorks 2023. I caught some of the highlights online. I know Melody Brew is going to be covering this extensively, but I think the big announcement there was all about Box Hubs.

Now, it’s super easy to say, oh, it kind of looks like a SharePoint that’s easy to use. But the thing about it is inside of organizations we haven’t nailed, and by the way, Google has what’s called workspaces. The challenge though is the ability to share… Oh, and I’ll just say Microsoft has kind of moved to Teams being able to be the hub for work groups and sharing information out. But I really am impressed with Box Hubs because it makes this type of capability seamless and secure. And I’m not saying the other solutions aren’t, but I urge you to go into the videos to look at this. Hard to appreciate how good this is. So imagine you have an account team and you have a combination of internal documents, you have external documents, and not only are you working on it as an internal team, but you might have external third parties you want to share with.

And the great part about this is Box won’t let you make a mistake because each document or each file, and by the way, this can be a PDF, Word document, PowerPoint, pretty much anything that it cuts across, the ability, each one of these has a special designation. And yeah, you can do add-ons in the Microsoft environment, but this is just seamless. And what happens is you pile on generative AI onto it. You can go into your number one account, company X, Y, Z, and be able to query all the history, everything about that company using generative AI and be able to get a good response. And those people who don’t have authorization to access data that was based upon documents, you don’t get access.

So, I think it’s one of the best expressions, and I have to give the company a lot of credit for its 15 second snippets in where it shows the power of what they do. And founder and CEO, Aaron Levie does a great job in getting this across. And to me, this shows the difference between a company who specializes in something versus somebody who has this, let’s say as a feature. And that’s the challenge that Box will have continuously is, how do I not get sucked into freebie land as part of a suite and be able to charge a commanding, an appropriate amount of money for what it brings to the table?

Daniel Newman: Yeah. So, I want to focus on one thing in particular from this Box announcement, and that’s in alignment with what I’ve been saying for a while that companies that are going to succeed in this generative AI era are going to have a strategy to monetize generative AI. And what I liked about what Box announced at BoxWorks was, it provided both its customers and its investors with clarity as to how the company intends to use its enterprise content management suite to make money and also deliver value, which will grow with the growth of generative AI capabilities. So basically there’s two use cases that have been most popular and that’s creating content with Box Notes. And that’s been querying the documents inside of Box with the generative AI tool, getting to an understanding of an average user of how frequently they’re using these capabilities. And then of course, being able to understand how a company can then generate revenue for Box was the thing that I was really focused on here.

So, I like that it’s kind of focused, it’s specific, it’s understood, it’s a credit system. I like credit systems. Adobe is doing some of this similarly with Firefly because it also doesn’t always feel like money. So, it gives people, they’re going to use it a lot and they’re like tokens. And every time this token gets used, more volume gets used, and then eventually it does add up to more revenue. Box is looking for that sort of path to more revenue growth in the near term. And I think generative AI laid on top of a enterprise content management suite like Box is a good way to do it. It’s straightforward. People understand how they’re using it and they understand how they’re paying for it. So nice announcement. There was obviously other things, but that was probably the one thing that caught my attention and that I thought the company did particularly well.

Patrick Moorhead: Yeah. So, let’s move to the next topic here, and that is more AI. AMD acquires a company that, it’s funny, I want to call it Node.ai, but it’s Nod.AI.

Daniel Newman: I did the same thing. I was calling it Node for like 30 minutes talking to a journalist about it. I’m like, “It’s not Nod.: And they’re like, “I think it’s Nod.” I’m like, “Oh.”

Patrick Moorhead: I know. I affiliate nodding with nodding off or sleeping or something.

Daniel Newman: Yeah, I guess we’ll give a nod to what AMD is doing today.

Patrick Moorhead: Dan, you get one a day, okay?

Daniel Newman: Yeah. By the way, you can’t spell AI without Nod.AI.

Patrick Moorhead: That’s not as good.

Daniel Newman: That’s not as good. That’s not as good as Aviator. All right, so look, there are lots of startups and you’re seeing AMD is taking a build by partner approach to growing its AI capabilities. Last week we saw some very interesting announcements with Lamini. This week, it was Nod.AI. They’re not a household name. I had not heard much about them before. But having said that-

Patrick Moorhead: Wait a second, is there a possibility this is not AI? We’re not even saying this correctly.

Daniel Newman: It’s not. There’s no way. But look, there’s kind of a few different schools have thought about building the future of generative and AI capabilities. One is closed architectures, one is open source. We know that in the NVIDIA world it’s built a huge vacuum and vortex of growth around CUDA and around the ability for you to really build your AI future on its software and not moving away from it. For AMD with ROCm, with its whole approach, it’s the un-X86 of the future, which is going to be all about open source. So, I think the company is continuing to make investments here and wants to show through both partnerships and building and then of course its strategy that it wants to have a more complete offering. It wants to be able to compete. We’ve seen that it takes some time. And so, I think that’s what you really got here. This is an augmentation of their capabilities. It’s a company that has, their SHARK is their sort of well-known platform.

It’s all open source. They are all about optimization of model. And they’ve not only been optimizing for AMD, but they’ve been optimizing historically for others, including Intel. This is a company that went from hardware and actually over time, grew into this particular space of software optimization. As far as I see it, Pat, there’s kind of this whole continuum for companies like AMD where it’s first you’re going to make the hardware so you know what they’re doing with MI and their series. Second of all, you have to make software. Well, there’s a lot of open-source AI software. We hear companies like Meta is very focused on open source. That’s why they’ve been all about PyTorch and building their future and PaLM and that’s Google LaMa. But what AMD needs to do is make sure that LLMs and these different foundational models run better on AMD than on anything else.

And so this kind of acquisition is about how do you basically optimize the software for the hardware so that people that choose to build on AMD, choose to build on AMD’s open source platform also get the best experience. So to me it’s a nice tuck-in. This is not something that, it wasn’t on a size deal. I don’t even think a number was mentioned in terms of how big it was. I think it was a gathering of IP, of highly capable professionals. And then of course a story that says AMD is committed to building software that runs better on its hardware than any other hardware in the marketplace. And it’s an important move, but time will still tell if AMD can garner market share from NVIDIA, which is something I think we’d all like to see because we all want to see competition.

Patrick Moorhead: Yeah, I see this as an acquihire.

Daniel Newman: I still want to acquihire you.

Patrick Moorhead: Yeah, you can just takes a Birkin bag full of money on my front porch. But anyways, judging by the picture that Lisa Su took, now I know maybe all the employees weren’t there, but yeah, this looks like an acquihire of some really smart people and it’s very focused. There’s essentially three different ways to do machine learning. One of them is supervised learning, unsupervised learning, and then there is what Nod.AI does, which is reinforcement learning. And what reinforcement learning is, is it’s an AI where you don’t have to give it perfect data. It essentially learns on its own from you don’t have to do special tagging and stuff like that. And my guess is that AMD wants to build out certain libraries for certain types of AI and here we go. This is just yet another affirmation that AMD is getting serious about AI for the data center.

Daniel Newman: It’s all you.

Patrick Moorhead: Yeah. Hey, let’s move to the next topic and that is Adobe MAX. So first and foremost, when you’re a large company with a lot of history and big business, the way you get taken down is with a startup. A series of self-inflicted wounds, the inability to have organic innovation, and here we go. Adobe is clearly showing here with generative AI that they are on the move. Y’all might remember their first generation of technology that came out called Firefly and Firefly was a way to get in there. And Adobe MAX, what they did is they integrated Firefly type technologies into basically their entire Creative Cloud where it was standalone before, now it’s integrated in. The one feature that blew me away that was new, actually, there were two, first of all, brand new Firefly image models that we saw with DALL-E two to DALL-E three made images just look incredible.

And oh by the way, it comes from content that you’re not going to get sued over if you’re an artist and you use it. The second feature that just blew me away was, with Firefly, you used to, well not used to, you go in on an image and say, remove the background and replace it with a sunset, when you go in and do that. Now you can do that for videos and that is absolutely mind-blowing. And you could do this as an artist, but you couldn’t do it auto-magically with a prompt. So Adobe is on the move just showing their incredible amount of organic innovation.

Daniel Newman: So Pat, there was probably a dozen, maybe even more different announcements. I think I read there was like 12 AI announcements. I thought they had pretty-

Patrick Moorhead: Like ten Press Releases.

Daniel Newman: Yeah, there’s so many. I liked some of this stuff with the clothing. I can’t wait to be able to try on my vests and then have it auto-magically tell me how good I’m going to look with a certain vest shirt combo so I don’t have to keep trying them on every day. Guys-

Patrick Moorhead: Where’s your bestie vesty, dude?

Daniel Newman: This look doesn’t come naturally. I just want people to know this. I mean, this is a lot of work that goes into this, but also I thought they had a couple of really good… MAX is the creative thing. And Pat, you and I, this is something we personally are passionate about. So just a couple of things I guess I’ll point out is, I thought some of the starts, what they’re doing with Stardust and See Through were pretty interesting to me. Probably most valuable to me is how See Through could be applied to video for us because the reflections, there’s nothing that drives me more crazy than when I can’t get rid of reflections with lighting. So, the fact that they can really up level and upscale. And then they had some definite important resolution boosters for video and that was also pretty cool.

So, kind of the way generative AI can be applied, Pat, to make our video better is something I think about because think about today, you’re traveling, you don’t have all your best equipment, you’re in a place, how can you optimize your environment? And so often, by the way, when we have guests, their best environment isn’t good enough for us. So, lots of that kind of technology, I thought they leaned into that at MAX. I’m excited about how it can help boost the Six Five and all these weekly shows that we do. But I also do love some of this stuff, the doodles to art and all that kind of, but like I said, I’ll talk to the creatives to see what they say.

Patrick Moorhead: Dan, could you get the shine off the forehead?

Daniel Newman: Oh man.

Patrick Moorhead: So funny. Let’s move forward. I know you’re a busy guy here. So, listen, CNBC article came out that said Microsoft owes $29 billion to the IRS for back taxes. Is that the craziest thing you’ve heard of?

Daniel Newman: Well, I mean, it’s not the craziest thing, but I would imagine that, is this a government shakedown or is this something that requires a little bit more attention? Now, before I talk about this, I do want to point out in some good news for Microsoft, the Activision deal closed today. So while we are amidst a, “Hey, you might owe us $28 billion,.” The other massive deal did close. And by the way, what a great deal for Xbox. I mean, that was a big win and another big L for Ms. Lina Khan. Just another deal that she wanted to stop that she couldn’t. Anyway, I know it was the UK, so it wasn’t actually us anymore, but still it was just another one that they put up a fight. Anyways, all right, back to the story at hand. Look, Pat, this stuff’s kind of interesting, because you’re literally talking about the government just went back 10 years, 2004 to 2013, and it basically said that there was taxes that were not paid and now there’s about 10 billion that the company said they did pay that are not being reflected.

But Pat, these are huge numbers. I mean, my take here is that this is probably stuff that forensic accountants and specialized lawyers and financial gurus are going to be spending their time over the next, what do you think, two years, three years? This is going to take a long time. This is not going to go quickly. I know that when the EC finds these companies, a billion here and a billion there, they just write the check and keep making the money. But I don’t think a $28.9 billion tax bill is going to get a quick swipe of the check from Satya and his team.

Patrick Moorhead: Does that go on the platinum card?

Daniel Newman: I think you need the black card to get that one paid.

Patrick Moorhead: That’s right.

Daniel Newman: I don’t even think platinum can handle that. But here’s the thing, Pat, this is a really interesting kind of story that I would put a big bubble wrapper of to be continued around because I just don’t know enough about it yet. What I will tell you is that Microsoft has come out on the record very emphatically saying, “We do not believe we’ve done anything wrong. We do believe we’ve followed the tax code.” And Pat, just to kind of come full circle and ask the question back that I started this with is, what’s going on here? Is this a, oh my gosh, we can’t figure out how to keep the lights on in Washington? Are tax collectors out there basically doing in-depth corporate audits of these big companies now? Are we going to see more of this coming in the next few years where they’re going to look back and look at the tax code?

And by the way, the complexity of the US tax code leaves a lot of opportunity for this kind of situation. But my gosh, Pat, could you imagine if you got a bill today for 10 years ago on taxes you thought you paid and the government was suddenly saying no and it was a big number. I mean, 28.9 billion to them is probably, I don’t know, $28 to you. But to most people, that’s a lot of money. Kidding, everybody. Kidding. Kidding, lawyers. We’re just joking. Pat doesn’t have 28 billion that I’m aware of. But I don’t know, Pat, what do you think?

Patrick Moorhead: Yeah, so this gets down, it’s very clear to me. So the meme is that big companies don’t pay taxes, but-

Daniel Newman: That’s so not true.

Patrick Moorhead: The reality is that companies operate in the tax environment, in the incentives that is set up by Congress and they’re just operating that environment. And there might be energy credits, there might be investment credits, there might be things that they do to take advantage of that. And there’s also international tax law and the way that things are taxed overseas. So, if people have an issue with the way that things are taxed, change the tax code, because these companies are just operating in that. And the other thing we forget is that every wage, everything that’s paid for has a tax on it. Every person at Microsoft that operates in the United States, they pay income taxes, they pay likely city, state, and federal taxes and everything that’s purchased for every one of these sites and for every employee is taxed. So, I think it started with the meme and people have just taken that to the next level. Congratulations Microsoft on getting the Activision deal done. It took a long time, but it happened. And congratulations.

Daniel Newman: Hey, so it is funny, we get taxed on what we earn. If you’re a corporate, you get taxed on what the company earns, then everybody in the company, and then you get taxed on what you buy. So, you take that dollar that’s been taxed and then you buy something with that tax dollar that gets taxed again. And then by the way, when you take it home, you get taxed again on what you own. So you take that tax dollar and you buy something that’s been taxed 30, 40% and then you pay tax when you buy it another 10, seven, 10, 12%, Pat, and then you get a bill at the end of the year with that tax money that got taxed on that thing you buy to pay tax again. I don’t know if this is making it obvious where I stand on this, but I feel like people do pay quite a bit of tax, so it is pretty interesting.

Patrick Moorhead: Yeah, no, I appreciate it. I think I failed to mention those two different levels of taxes.

Daniel Newman: No, I just think it’s great. I think it’s great that you reiterated that.

Patrick Moorhead: So, Dan, let’s go to the last topic here. Google apparently is going to defend AI users for copyright claims.

Daniel Newman: Yep. It’s all you, but if you want want me-

Patrick Moorhead: Oh my gosh, you gave that one to me.

Daniel Newman: You want me to do it?

Patrick Moorhead: No, no, no. So, as we’ve seen with Microsoft, and we saw, I think it was really highlighted with IBM, the need to defend or indemnify folks for copyright claims against their large language models is a big deal. Particularly if you look at open AI and even Bard and even AWS Titan embedded models, there is no white paper that says what the sources are. And I think this is less about companies being nefarious, but more about its intellectual property is you don’t really know what’s going in there. So, the one way to just cut through all that is to indemnify and/or defend from copyright claims on that data. So, Google has bellied up to the bar. I haven’t done the deep analysis to compare and contrast each one of the companies, but I think on the last podcast we all agreed that this is just going to be the way things can go.

You want to scare particularly enterprise users and scare them off your products, come and do something different. And I kind of love this new competitiveness. First it was open models versus all closed models and everybody’s like, yeah, we did a combination of the two. And then Microsoft came out first I think for… No, actually right around the same time IBM and Microsoft came out with their, we’re going to help you fight copyright claims, but Google bellies up to the bar and we’re off to the races.

Daniel Newman: Table stakes, sir. This is all table stakes. Every company’s going to do it. Every company has to do it. Companies will try to find some differentiation on their approach of how they do it. For instance, Google is saying that it really is focusing on both sides of the claim, meaning that technology that’s built with Vertex, they will support that as well as things that are created using software such as it’s Duet or an image creator. It will support that. Now, they did put a fairly significant parenthetical around this thing that they will not support people who are intentionally using their platforms to create things that might infringe upon a copyright, Pat.

The responsibility of AI due to the pace of which we are moving has moved from the user to the vendor. The vendors want to roll out at this pace and want to get this scale of AI and users’ hesitation is often around the legitimacy, the accuracy, and of course the license rights and ownership of the content or generated images or whatever it’s performing on on the user’s behalf. Adoption will scale faster. If people believe they’re indemnified, then the business, the use and the spend will grow more quickly. But I don’t see a situation, I do not see a world in which the companies that have substantial AI generative capabilities. So we’ve heard from Microsoft, we’ve heard from IBM, we’ve heard from Adobe, we hear from Google. Now, this will continue not the last, not the last, not the last. So hey, we did it. And you know what, Pat, I just want to say thank you for working on your day off.

Patrick Moorhead: No, I appreciate that. And I think we both know that none of us take real days off. Someday, I’ll get this right. I think I’m mature enough to figure this out, but I do have a high level of dedication, particularly for the Six Five and obviously my own company. But I’m going to try to tune out. My 86, soon to be 87-year-old dad is in town and I want to give in my full attention.

Daniel Newman: The other question I have is, how the heck did you get fired on your day off?

Patrick Moorhead: How did I get what?

Daniel Newman: Nothing. It’s an old line from a movie Friday where he says, “How did you get fired on your day off?”

Patrick Moorhead: Oh funny. I thought how to get fire, like fire starter.

Daniel Newman: No.

Patrick Moorhead: Anyways, folks, I want to thank y’all for tuning in here and if you showed up on time, my apologies, I’m on my second laptop, isolated it down to a USB-C adapter. I think I figured out what happened. I plugged the camera into that high-speed port and it was sucking too much bandwidth and the audio stopped working.

Daniel Newman: You see how nerdy he is?

Patrick Moorhead: Sorry about that. Hey, thanks for tuning in folks. We really appreciate that dedication. Smash that subscribe button if you like what you heard. All complaints, go to Dan, all accolades, go to me. You know where to find us on social media. Take care and stay safe out there. We really do appreciate you. Bye bye.

Patrick Moorhead
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Patrick founded the firm based on his real-world world technology experiences with the understanding of what he wasn’t getting from analysts and consultants. Ten years later, Patrick is ranked #1 among technology industry analysts in terms of “power” (ARInsights)  in “press citations” (Apollo Research). Moorhead is a contributor at Forbes and frequently appears on CNBC. He is a broad-based analyst covering a wide variety of topics including the cloud, enterprise SaaS, collaboration, client computing, and semiconductors. He has 30 years of experience including 15 years of executive experience at high tech companies (NCR, AT&T, Compaq, now HP, and AMD) leading strategy, product management, product marketing, and corporate marketing, including three industry board appointments.